Topic: Discussion about 10,000BTC Bet (Official) - page 54. (Read 104460 times)

4. Creating sockpuppets to hide your true identity but forgetting that people can recognize you by the way you talk.

Edited original post to foolish however it has been socially acceptable to call someone a retard in the UK for over a year now (so long as they do not suffer from retardation). Hatty in Eastenders made the statement "stop acting like such a retard" in January 2011 prior to the 9pm watershed, in a poll of Sun readers 86% of readers found this acceptable.

Retard
1. A person with a mental deficiency
2. An offensive term used to refer to someone acting in an irritating or generally stupid way.
3. Someone trying to either con $200+k in bets out of a community of people or worse still lose it making a nonsensical statement about god only knows what!

Sigh. "come accross like a border line retard". Ignoring for the moment your spelling difficulty, please do not use such childish and bigoted language. The following would be acceptable: "I'm not a developmental paediatrician and you should know that I have no idea what I'm talking about when I say this, but you are borderline developmentally delayed".

Or you can just call someone foolish, or lacking in appropriate decision making skills. Note that these options do not require you to make a comparison to a group of people who already have enough problems to deal with.

Unless of course you are childish and bigoted and developmentally delayed, in which case go ahead with your original statement.

Mathew I'm curious how you made any money to bet in the first place, this bet and the "statement" you are trying to make about pirate makes you come accross like a border line foolish imo

Reposting from another thread:

Of course, if you can sell it for 50% or better, that's probably a better deal. Taking a hedge bet like this reduces your risk from already purchased debt. Buying debt after making a bet like this only increases your risk.

Look at it this way:
Long ago, you invested in BS&T. At the time, you thought it was a good investment. Now it's looking like it's not, so you pick up some of Matt's action. If it was a bad investment, he'll pay you half (let's say) of what you lost. If it somehow turns out to be a good investment, still, you'll have to pay him half of that, so basically what you're doing is trading some of your Pirate risk for Matt risk, but they even out, so either way, you get half of what you've already risked. Even if he doesn't pay out, you're no worse off than you started, because before he did this, you would have lost 100% anyway.

The other way around, however, is not so beneficial. You start out with X Bitcoins. You bet some of that on Matt's venture. Half is easy to work with, so let's keep that. At this point, if Pirate defaults, and Matt doesn't pay, you still have X. If he does pay, you have 1.5X. If Pirate pays out, you have .5X, if you choose to pay out, otherwise you'll be labeled a scammer. If you then buy pirate debt, again, let's assume .5X worth, you now have X-Y Bitcoins (Y being the amount you paid for that debt). If Pirate doesn't pay out, and Matt does, you now have 1.5X-Y, less than you would have had if you had not bought the debt. If Pirate doesn't pay out, and Matt doesn't either, you still have X-Y, again, less than you would have had if you had not bought the debt. If Pirate does pay out (and for ease of math, we'll assume 100%, but that's by no means certain), you now have X-Y, less than you would have had if you had not made the bet at all, but more than if you had not bought the debt. (and, you'll note, less than you started with)

To sum up:
If you have already sunk money into Pirate, but aren't sure he'll pay back, it makes sense to hedge that money with a bet against Matt. Worst case scenario, you're no worse off, and best case scenario, you'll at least get some of what you've lost back.

If you have not yet sunk money into Pirate, but are pretty sure he won't pay back, it makes sense to bet against Matt.

If you have not yet sunk money into Pirate, but are pretty sure he will pay back, it makes sense to buy Pirate debt.

Under no circumstances does it make sense to do both.

So what is it that you think he's doing?  That you bet 30k btc on..??

What he means is (I think), if you already have money loaned with pirate the bet is good as you can hedge your loss.  If someone hedges 50% of what they loaned to pirate then if pirate does not pay at all the person gets even money.  If pirate pays pays 10% of his obligations, then the creditor makes a 10% return after getting their money from their hedge.  A person can reduce their risk to essentially the probability that Matthew will honor the bet.

Also, it is not a logical fallacy as conditions change over time.  It just depends on the risk/reward ratio of the debt being purchased.  Loaning money to someone in the past may have made sense, but if they default and their credit rating changes, loaning more money to them for the same reward would be foolish as the risk has increased.  The investor/gambler needs to see how much is debt being sold for, and calculate how much they need to hedge and still make a profit.

Logical fallacy.

If keeping Pirate debt debt and hedging it is a "best bet" then buying Pirate debt bet and hedging is equally the "best bet".
Conversely if buying Pirate debt and hedging it is a "bad bet" then someone with a with an existing debt shouldn't keep it they should sell it and thus keeping the Pirate debt and hedging it is equally bad.

If someone can buy then someone else can sell.  One can't be bad and the other the "best bet".

Does your brain not comprehend logic.  Is everything just luck and unicorns?

I agree, I was more talking about "Investments are not bets" or "Luck is not involved in risk"

Not sure understanding either is necessary to understanding compound interest...and that's all ya really gotta know to see through the pirate scandal.

This^

If you're into Pirate for any amount, your best bet (heh) is to wager up to 50% of that with Matt. The inverse, however, is not true. Buying Pirate debt after making a wager with Matt is betting against yourself. Never do that. You always lose.

If Matt wins, I will pay him every last satoshi of my bet. To not do this would go against my word and honor.

Additionally, he is providing a great service by allowing people to hedge their situation.

Were I making an investment portfolio, I would most definitely do it the way he suggests: Diversify, try to pick good risks.

I would not include a wager as part of an investment portfolio. If it is included in any portfolio, it would be in the one labeled "casino money."

I would not count on any individual item in either of those portfolios to pay off, and I would be prepared for (and accept, when/if it came) the eventuality that all of them failed. (Also, I would expect that in the latter portfolio, it leans heavily toward when, rather than if)


I actually don't have any issue with others deciding that Matt's bet is the one to take. If you think Pirate is going to fail to pay out, then it only makes sense to take Matt up on his offer. What I find to be foolish is making investments based on the expectation of receiving a payout from Matt. Or more accurately, blaming Matt for your malinvestments based on the expectation of receiving a payout from Matt.


Well, assuming they're willing to walk away. That was the point of "established members only", and his vetting of bettors prior to accepting their bet. Even if Matt gains no money whatsoever, everyone ditches, he still gets rep for putting his money where his mouth is. He can't lose, here, even if he does lose.

But if you calculate the risk/reward ratio for this pirate default bet then there really is no risk, as the gamblers do not have to put their money in escrow thus no money is being risked.  If they lose the bet they simply walk away and open up a new account.  If they win the bet, maybe they will get paid.  I believe Matthew got the bad bet as he has many people he is betting with and more reputation to lose if he does not pay every single one of those bets.  On the other hand, all the other investors can simply ignore the bet if they lose, lowering Matthew's risk/reward ratio.

So, after that chat, can you see why I disagreed with the bolded statement above? It all comes down to the actual risk assessment. If you have assessed the risk of this bet not paying off as less than the risk of Pirate defaulting, then taking the bet with Matthew would be a valid choice. I think what you might mean (correct me if I'm wrong, I'm not trying to put words in your mouth) is that this particular risk appears to you have a guaranteed negative outcome, so one should not rely on the risk paying off.

So the reliance on the money that may or may not be gained from the bet with Matthew is not generally a bad thing - it is only so because in your assessment of the potential risks and rewards (the variance and expected value of the pay out) that the bet can only cost bettors.

If someone has assessed the opposite, then relying on the the bet should only be done to the extent of the variance in payment you have assessed as being likely.

Reading this thread makes me realize how weak people are in game theory and statistics.
organofcorti : Thanks for defending Maths

Then let us end this little digression with this statement:

In my estimation, Matt is the house, here. Long-term, he comes out on top whatever happens.

You'd be placing money in an investment vehicle that can be assessed - in the long run - to guarantee a negative return. The risk of this not being a good long term investment is 100%.

If you were the house, I'd say it would be a risky (variance prone) but positive long term investment.

Edit:Matt I appreciate the gentle way you attempted to prod us back on topic, and I apologise for completely ignoring your hint.